Rahm Emanuel counts on big donors, with many getting City Hall benefits
|Mayor Emanuel's job is to fund raise then award his sponsors.|
Mayor Rahm Emanuel is building the most potent political cash machine in Chicago history by focusing on an elite circle of donors who frequently receive City Hall benefits, ranging from contracts and permits to appointments and personal endorsements from the mayor, a Tribune investigation has found.
Emanuel has tapped these roughly 100 most loyal contributors for more than $14 million — nearly half of all the money he's raised since he left the White House to run for mayor. All those key donors — consisting of individuals, couples, business partners and firms — are repeat givers.
The mayor regularly courts his benefactors behind closed doors — at their homes, at restaurants, and at the downtown headquarters of their law offices, development companies and investment firms. He welcomes many to his own fifth-floor office in City Hall.
Emanuel's 60 elite donors, with connections
In an unprecedented look at the intersection of Emanuel's political fundraising and his public duties, the Tribune analyzed years of his public schedules, thousands of administration actions and all of the more than $30.5 million in contributions to his campaign funds since he first ran for mayor in 2010.
The examination found a pattern of mutually beneficial interactions between the mayor and his major supporters. Some of those actions play out in public as part of the Emanuel administration's high-energy marketing strategy. But the political piece typically takes place behind the scenes.
Emanuel is at the center of it all, moving seamlessly between his roles as chief executive and chief fundraiser.
The pattern may be best viewed through Emanuel's top donors.
Nearly 60 percent of those 103 donors benefited from his city government, receiving contracts, zoning changes, business permits, pension work, board appointments, regulatory help or some other tangible benefit.
In some cases, the benefits are related to Emanuel's role as Chicago's endorser-in-chief.
The mayor holds news conferences to promote major real estate developments that still need city approval while tapping the investors for political cash. He lends his credibility and cachet to other top donors by publicly praising their business expansion plans, by appearing at their firm's meetings or by pitching Chicago's strengths at conferences they sponsor.
Emanuel regularly meets with his political supporters, a level of access provided to few in the city. His public calendar listed 376 business meetings, public appearances and private fundraisers involving the mayor and political donors in 2013 and 2014. About 1 in 5 of all of Emanuel's business meetings with non-staff members involved a campaign donor.
Emanuel's donors respond
Neither Emanuel nor his top donors are hindered by his narrowly drawn executive orders restricting campaign contributions from people seeking city business. State conflict of interest and campaign regulations likewise do not address the type of symbiotic relationship between the top political donors and the powerful mayor, who dominates the City Council, controls every city agency and maintains close relations in the White House he ran as chief of staff just a few years ago.
Emanuel's prowess as an in-your-face fundraiser for fellow Democrats from Richard Daley to Bill Clinton to Barack Obama is legendary, a hands-on approach he now uses for himself. Emanuel declined to be interviewed for this story.
In response to Tribune questions, the mayor's communications director issued a statement citing the ethics rules he adopted in his first days in office. They bar contributions from city contractors or those seeking city business, but only under specific circumstances.
"Mayor Emanuel has strengthened ethics and campaign fundraising standards more than any other mayor, strictly adhering to existing law and those higher standards he has set for himself via executive order that further limit campaign contributions," spokeswoman Kelley Quinn said in the statement.
"And the mayor's record consistently reflects his willingness to take on special interests — including holding Wall Street banks accountable for managing their vacant properties in our city, eliminating fuel tax loopholes for airlines, and eliminating tax exemptions for cable companies and on luxury corporate skyboxes — to always ensure the interest of Chicago's taxpayers and residents are protected."
Power base built on political cash
While previous mayors have used ward organizations and patronage armies to dominate local campaigns, Emanuel has little of that kind of infrastructure. Instead, he derives his political muscle almost entirely from fundraising.
When the mayor sees his donors
His campaign funds serve as both a defense against potential challengers and a weapon to take on opponents. He started months ago airing television campaign commercials aimed at building his advantage for the Feb. 24 municipal election.
It took Emanuel's predecessor, Daley, nearly three decades to accumulate $40 million. Emanuel is three-fourths of the way there after just four years. To do it, Emanuel has cultivated many of the same power players from Chicago — and dozens more from the national level during years of working Hollywood, Wall Street and the Beltway.
More than half of the $30.5 million raised for Emanuel by the end of 2014 came from just 348 donors. That combination of individuals, business partners, spouses and firms poured $17.8 million into his funds both before and after he was elected.
Within that group is an even more select cadre of 103 donors who contributed at least $10,000 to Emanuel before he was elected mayor and at least $10,000 more after he took office. That group's total donations add up to $14.5 million, most going to Emanuel's two campaign funds and the rest to an Emanuel-aligned political action committee.
Emanuel ended 2014 with a flurry of donations that boosted his campaign funds to more than $6.5 million — six times the combined resources of his two biggest challengers, Ald. Bob Fioretti, 2nd, and Cook County Commissioner Jesus "Chuy" Garcia.
And as the year drew to a close, Emanuel's dual roles as city builder and political candidate were on display with one of his top donors.
'A great building'
In mid-December, Emanuel stood alongside the co-CEO of Magellan Development Group and officials of the firm's Chinese partner to publicize plans for a hotel, retail and condominium building along the Chicago River that could become the city's third-tallest skyscraper.
The project is still subject to multiple steps in the city's permit process, including City Hall approval of Magellan's proposal to build the tower 500 feet taller than the Lakeshore East development plan allows. But Emanuel pronounced it a "great building" and applauded the Wanda Group of China for choosing an "all-Chicago" team, including Magellan.
"At many different levels, this opportunity and the agreement we're going to sign today — the parties are going to sign today — I think speaks volumes about the city of Chicago, the opportunity here, and the opportunity to continue to build a great city," Emanuel said.
The mayor conducted the news conference himself, gesturing to Magellan co-CEO Joel Carlins to speak at the microphone and then ushering the partners to a table for a ceremonial signing of the development agreement.
Four months before the news conference, Carlins was the host and Emanuel was the guest at the wealthy developer's home, according to the mayor's calendar. The purpose: a fundraiser the mayor requested, according to a source with knowledge of the event.
On that day, Aug. 26, and in the weeks that followed, Emanuel's campaign logged checks from Carlins and eight other Magellan employees and one spouse totaling more than $47,000. That's on top of $16,300 in previous donations tied to the firm.
Magellan officials declined to comment.
Emanuel places no restriction on donations from real estate developers, even though city approval of their projects can be worth far more money than a city contract would be to another business.
On a stretch of North Clark Street in River North, three companies — all among Emanuel's top donors — have a piece of a development that needed several OKs from City Hall.
The main developer, Friedman Properties, built a major hotel complex that opened in 2013 and features more than 600 rooms under three different hotel names, including the Aloft Chicago City Center. Emanuel collected more than $75,000 in donations tied to the firm, including more than $30,000 from CEO Albert Friedman.
The project was built in partnership with another top donor, White Lodging, which gave Emanuel $66,000.
Friedman and White Lodging did not return calls for comment.
Housed inside the hotel complex is the restaurant Beatrix, a new concept from Chicago's famed Lettuce Entertain You Enterprises.That firm, run by well-known Chicago restaurateur Richard Melman, is another top donor linked to more than $236,000 in contributions to Emanuel. The Tribune last year detailed how Emanuel's administration welcomed Lettuce Entertain You to O'Hare International Airport just a month after the company held a major fundraiser at the request of Emanuel's campaign.
Kevin Brown, the CEO of Lettuce, said Melman told him about the fundraiser and he went to show his support for the mayor's efforts in the city, not because of any pressure or the O'Hare business. He said the mayor's comments were likewise not directed at Lettuce.
"It was just, 'Thank you for being here,' and he's proud of the city," Brown said. "He was encouraged about the city and where we're headed."
It usually starts with a phone call saying, 'This is your mayor calling, and I need help.' I say, 'No you don't.' And he laughs, and then we start talking.- Attorney Robert Clifford, one of the 103 top donors to the mayor Emanuel frequently calls his top donors personally, asking them to contribute to his campaign or host fundraisers in which their employees, spouses and friends can help fill his political funds, according to donors and others in Chicago political circles. Some who receive such calls feel pressure to give because the mayor himself is making the request, said several people familiar with the mayor's fundraising practices.
In many cases, once those business executives agree, Emanuel's longtime fundraiser Anne Olaimey follows up and handles specifics, including when and where fundraisers will be scheduled and how many donors to expect.
Well-known personal injury attorney Robert Clifford, a major Democratic fundraiser and among the group of 103 top donors to the mayor, described Emanuel's personal touch.
"It usually starts with a phone call saying, 'This is your mayor calling, and I need help,' '' Clifford said in an interview. "I say, 'No you don't.' And he laughs, and then we start talking."
Clifford said he has known Emanuel since his days as a "force of nature" raising money for national Democrats.
"He's learned how to use that phone pretty well," Clifford said.
Clifford said he doesn't do business with the city "in any way, shape or form." He said he and his wife, who chairs the Goodman Theatre board, donate because "we're just proud of him."
A number of Emanuel's big donors were stalwart Daley supporters when Emanuel was just a fundraiser, including many of the city's top developers.
John Buck has erected some 20 office buildings, condo towers and hotels in the last 34 years. And, as with Daley before him, Emanuel has significant ties to the pre-eminent developer.
In January 2013, Buck invited Emanuel and other business leaders to Buck's condo overlooking Lake Shore Drive for dinner with billionaire British mogul Richard Branson, who had hired Buck to redevelop the historic Old Dearborn Bank Building into his first Virgin Hotel in the U.S.
Mayor Rahm Emanuel along with then-Deputy Mayor Mark Angelson, center, and Michael Sacks, Vice Chairman of World Business Chicago and top Emanuel donor, give a press conference on the green rooftop at City Hall in 2011. (Nancy Stone / Chicago Tribune)
Two months later, Emanuel invited Buck to the fifth floor of City Hall, his calendar shows. Soon after, Buck started clearing tenants out of a squat, six-story building at 200 N. Michigan Ave. to make way for a project of his own — a 42-story glass residential tower.
In July 2013, Buck's project would start to wind its way through the city planning department and then to a City Council zoning committee, where it would sit for four months. That December, Buck filed plans with the city for a second project — a 37-story Loop office tower.
Within a week, Emanuel would cash $37,000 in checks from seven Buck employees, on top of two maximum $5,300 contributions Buck and his wife had made a couple of weeks earlier.
Emanuel had Buck back to City Hall for a meeting on Jan. 16, 2014. Seven days later, Buck's Michigan Avenue residential tower passed through committee, followed by unanimous City Council approval. The Emanuel administration and aldermen signed off on Buck's second project at the end of April.
Emanuel returned to Buck's condo in September 2014, three days before he attended the Michigan Avenue groundbreaking with Buck, the pair posing with silver shovels in their hands.
Buck did not return calls for comment. Emanuel's spokeswoman said Buck's donations don't affect his treatment at City Hall.
"Owners or employees of entities doing private projects — including homeowners who seek construction permits for their homes, small business owners who apply for licenses, or other individuals involved in private business and require a standard city approval — are not prohibited from contributing to candidates at any level," Quinn said in an email.
Emanuel's City Hall has granted more than development approvals to Buck, who along with employees and his wife have donated $140,000 to the mayor. Two pension funds controlled by the mayor have used Buck's firm to make real estate investments. Buck was also appointed by Emanuel to World Business Chicago, a powerful and exclusive economic development board of more than 70 members that drives deals to bring new businesses and investments to the city.
World Business Chicago
Emanuel's top donors account for 18 members on the World Business Chicago board, which strategizes with the mayor behind closed doors on ways to improve Chicago's economic future.
Craig Duchossois, CEO of Elmhurst-based Duchossois Group, another top Emanuel donor and WBC member, said he gets calls from the mayor asking for donations. He and other WBC members said they didn't see their appointments as a benefit, but rather a form of public service.
Leading the board is Michael Sacks, CEO of the hedge fund firm Grosvenor Capital Management. Sacks, his employees, spouses and others tied to the firm have donated more than $1 million to Emanuel, making Sacks and his firm the mayor's No. 1 contributor.
Mayor Emanuel has strengthened ethics and campaign fundraising standards more than any other mayor...[his] record consistently reflects his willingness to take on special interests- Emanuel spokeswoman Kelley Quinn
Far more than a political supporter, Sacks serves more like a trusted partner as Emanuel governs Chicago. During meetings with key aides on vital topics such as pension reform or the city budget, Sacks is often the only private citizen in the room.
Sacks' influence cannot be measured in benefits to his firm. He has sworn off doing any business with the city to avoid conflicts of interest.
But when Emanuel needed a new city treasurer last year to replace City Hall's highest-level African-American official, Stephanie Neely, he plucked one of Sacks' most high-profile employees, Kurt Summers, the former top aide to Cook County Board President Toni Preckwinkle. Summers oversees how the city's capital funds are invested and will help decide if any of Sacks' contemporaries in the world of private finance will get city business.
Sacks declined to comment.
Law firms and bond business
Law firms are a rich source of campaign donations for Emanuel, and he has repeatedly appeared at fundraisers thrown by partners of big firms that get city business. Such fundraising might appear to violate Emanuel's self-imposed rules banning donations from those seeking city business and prohibiting city contractors from "bundling" donations to gain more credit.
But Emanuel campaign aides are always at the fundraisers to collect the checks from lawyer after lawyer, his campaign has said. Handling the money that way allows Emanuel — and the lawyers — to record the donations individually. That avoids the mayor's bans.
That's been the case at premier Chicago firm DLA Piper, which specializes in helping private developers find government incentives for their projects. That often means tapping into the millions of dollars in financing available through the city's tax increment financing funds, or TIFs.
In mid-2014, Emanuel made a guest appearance at DLA Piper's Global Board Meeting, at the Langham Hotel on the Chicago River. In September, he came back to help the firm a second time, addressing DLA Piper's Global Real Estate Summit, held at the Four Seasons hotel.
DLA Piper began giving to Emanuel early, records show, with the firm's lawyers and their relatives donating $54,000 to Emanuel for his first run for mayor. In summer 2013, more than $75,000 in donations tied to the firm were recorded.
Around the same time, DLA Piper was involved in getting tax subsidies for clients. In June 2013, the firm helped Chicago sausage company Vienna Beef secure a $5 million city tax subsidy, according to city records.
DLA officials did not return calls for comment.
Other firms that are major Emanuel donors make money from city bond business, such as Katten Muchin Rosenman, which employs former Mayor Daley. The firm made more than $360,000 in fees in two 2012 bond deals involving O'Hare, city records show.
Later that year, Katten lawyers attended a fundraiser held at the home of real estate heavyweight Judd Malkin and partly organized by firm partner Terry Newman, a good friend of the mayor's. Employees from the firm were recorded as donating more than $18,000. Newman also helped organize a second fundraiser for the mayor, Katten spokeswoman Jacquelyn Heard said.
Emanuel also gets donations from financial firms that act as underwriters for city bond deals, including The Northern Trust Co. and Goldman Sachs.
When Goldman Sachs was attached to a $600 million bond issue in 2012, the company still employed top donor Muneer Satter, who has since started his own investment management firm. Emanuel has been to Satter's Winnetka home, according to his calendar.
With wife Kristen Hertel, Satter has contributed more than $352,000 to the mayor, including a check for $100,000 as Emanuel was first running for office and while Satter was still with Goldman Sachs. Satter declined to comment.
City contracts, Emanuel donations
Emanuel's self-imposed bans on city contractors giving money to him don't apply if the company ownership is diffuse. That has meant hundreds of thousands of dollars flowing into his campaign, all tied to companies getting contracts from his administration.
Businesswoman Trisha Rooney Alden said she held one of Emanuel's first mayoral fundraisers, hosting about 40 people at her home in October 2010. Her father, former Waste Management CEO Phil Rooney, donated $10,000 around the same time. After Emanuel was elected, the Rooney family donated another $15,000 to the mayor's campaign funds, records show.
She heads a company called R4 Services, a firm based in Bridgeport that provides off site records storage for law firms, health care companies and governments. The City Colleges of Chicago approved a five-year, $400,000 contract with R4 for records storage in June 2012. A year later, the city of Chicago agreed to a $3 million contract with R4 for records storage.
Rooney said she donated because she is a long-standing friend of Emanuel's: "I've always been supportive of Rahm, both personally and professionally, and he's been the same for me. And I love the direction he's taking the city in."
Few relationships better illustrate the interdependence between Emanuel and his corporate counterparts than his ties to Madison Dearborn Partners, a longtime private equity firm that hosted the mayor at its annual meeting in November at the Four Seasons.
Contributors associated with Madison Dearborn are responsible for more than $858,000 in giving to the mayor's funds, according to the Tribune examination. Officials with the firm did not return calls for comment.
Madison Dearborn holds a significant stake in CDW Government Inc., which has received two Emanuel administration contracts worth more than $39 million.
Madison Dearborn co-CEO Samuel Mencoff, an Emanuel appointee to World Business Chicago, is one of the mayor's bigger individual donors.
And last year, loyal donors like Mencoff were given a new way to show their support for the mayor — a superfund PAC with the ability to bring in unlimited amounts of money under campaign law. While not allowed to coordinate with Emanuel's campaign, the Chicago Forward fund has the ability to support Emanuel-aligned candidates for alderman and assault the mayor's opponents with negative advertising.
The fund, run by a former Emanuel spokeswoman, was formed June 24.
Mencoff gave $150,000 on the day the fund was created, and many others followed.
In its first two weeks, Chicago Forward reeled in $1.3 million from 14 contributors. All of them are in Emanuel's circle of top donors.